Elon Musk’s consistent tweets on Bitcoin and Dogecoin bring a surge in their value. On Thursday, Bitcoin prices rose almost 3%, on the crypto ring image tweet.
Dogecoin Gains More Awareness with Musk’s Tweet
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A tweet by Elon Musk on Thursday, 11th February on Dogecoin, referring to the Lord of the Rings series, brought up prices of Dogecoin by 0.8% to $0.07. On Wednesday, his tweet on the purchase of Dogecoin for his son, “toddler hodler” had also created an upwards move to the crypto value.
Elon Musk’s tweet on Dogecoin has brought up the cryptocurrency to a record high value of $0.0810, early this week. The rich billionaire owns Tesla, the electric car company.
Dogecoin has made it as the Number 10 Digital coin in value this week, according to CoinMarketCap data. Trading value has surged $16.9 billion in a single day. It soared almost 1,300% year-on-year, setting a record.
In 2013, Dogecoin was created, with the Shiba Inu dog portrayed as its symbol. The crypto was introduced by Billy Markus and Jackson Palmer, two software engineers, as a “fun” alternative to bitcoin. However, its prices have been artificially boosted by big stars and corporates say, critics.
Elon Musk Invests into Bitcoin
In 2021, when Musk’s Twitter bio was tagged with “#bitcoin”, the prices of the crypto zoomed up by 14%. On Monday, it touched a record high above $47,000 with the tweet.
Musk has around 46 million followers on Twitter, and his tweets reach out to his followers immediately. His tweet mentioning his investment into Bitcoin to the value of $1.5 million brought almost a 10% surge in its price to reach a record high.
Tesla has bought bitcoin worth around $1.5 billion and has announced that cryptocurrency would be accepted as payment. The tweet from Elon Musk has brought in new retail investors into the cryptocurrency. Moreover, his support for bitcoin has created more investor awareness.
The world’s largest cryptocurrency has run up almost 45% between January and February 2021. Other digital currencies like Ethereum, Litecoin, Solana and Terra saw a sharp increase in value. Cryptocurrencies have gained more than $1 trillion in value last month. Tesla CEO Elon Musk says that broad acceptance by traditional finances will support appreciation in the value of Bitcoin. Bitcoin attracts investors as it is not controlled by any central authority or government.
Influence of Billionaires, Celebrities and Corporates on Cryptocurrency
The entire crypto market saw a huge surge in 2020 and 2021, with many companies and celebrities buying into cryptocurrency and inducing investors to it.
In February 2021, Musk had tweeted his support to bitcoin, and again prices surged. The world’s richest person’s tweet, “Only Doge”, “Who let the Doge out”, and “Dogecoin is the people’s crypto” brought a 60% surge in the currency.
Musk has tweeted many times, voicing his opinion on cryptocurrency. Just two days earlier, he had announced his “taking a break from Twitter for a while”. But he came back again to tweet on his investment of around 1.5 billion into Bitcoin. He had posted Dogecoin memes and called the crypto “the people’s crypto”.
Apart from Elon Musk, others like Simmons (Real name Gene Klein) and Snoop Dogg (real name Calvin Cordozar Broadus Jr) have boosted the cryptocurrency by marketing the crypto through their albums. SatoshiStreetBets is a Reddit group that has invested largely into the crypto market and making others know about it.
Cryptocurrencies have gained further momentum with players like PayPal and Visa entering it. They have allowed their users to make payments through cryptocurrencies by adding them to their app.
Others like Stanley Druckenmiller and Paul Tudor Jones have also shown their interest in the digital market, saying that cryptocurrencies are ‘an asset like gold’.
The 2017 Crypto Speculative Bubble
In 2017, the boom in cryptocurrency pushed Bitcoin to sky-high levels of $20,000, but within a few months, it dived downwards, towards $3,000. Celebrities had contributed to the crypto-fall in the 2017’s, and the same situation unfurls in 2021. After a rapid run-up, the digital currency market saw a crash in Bitcoin value.
Central banks across various countries are looking into ways to regulate the crypto market. Efforts are taken to legitimize digital assets and bring in more transparency in transactions.
Criticism Fear Another Crypto Bubble
Dogecoin, which began as a playful experiment, saw a steep rise in value, promoted by many celebrities, billionaires, and companies.
Experts, however, warn about the hype created by such personalities, saying that Dogecoin serves as a speculative currency that is misused by celebrities. The tweets on digital currency have been disconcerting say, experts. The co-founder of Castle Island Ventures and Coin Metrics Carter has come down strongly against the tweets by Elon Musk. Mike Novogratz, the CEO of Galaxy Digital has also criticized Musk for his comments on Dogecoin. People are going to lose a lot of money in Dogecoin, and it is worrying, say experts.